Business

1. Natsec dealpolitiking
2. Beijing’s business pitch
3. Treasury plots power grab
4. Apple’s privacy trap
5. Chevron’s license to drill
6. BigLaw backlash

Hi, and welcome back to Semafor Business, where we keep our group chats tight but would love to be added to yours.

For the record, I’ve received exactly one scoop in my career from being accidentally added to — and hastily removed from — an email chain, and it wasn’t that good. But moving on.

One way to understand today’s financial world is that everything is a cash flow. There’s a $14 trillion market in which loans are sliced, packaged, and sold to investors, who collect the repayments. Most are mortgages, but recent deals have tapped into payment streams for home heat pumps, private jet leases, and IP addresses. It’s all “a bit spicy,” even for the Janus Henderson executive who does this for a living.

The partnership announced last week between DoorDash and Klarna to offer installment loans for food delivery is the latest effort to turn normal commerce into Wall Street-bound cash flows. Takeout bonds — say, Non-Amortizing Culinary Holdings Obligations (NACHOs) — will feed a growing appetite from private credit funds, which have raised billions of dollars and are running out of things to buy.

Buy-now-pay-later loans make sense for big purchases, where they are cheaper than credit-card balances that might be carried for months at huge interest cost. But people who need to spread their sushi dinner over a few paychecks might not be able to afford the sushi at all, and we’ve added another one-click option to obscure that fact.

Wall Street went wrong once by assuming that people would keep paying their mortgages. Instead, borrowers abandoned their most important assets — their homes — by the millions. If the economy cracks, how eager will consumers be to stay current on their burrito bonds?

In today’s newsletter: Everything is national security now.

Everything is national security

Safeguard Treasury bonds. Secure the cloud. Undermine China’s race for influence across the global South. Companies are recasting their commercial priorities as national security imperatives, which executives hope will steer them past a mercurial White House whose regulatory priorities remain unclear, Rohan Goswami and I report.

Take Tether: The crypto giant is on a charm tour in Washington, where it is pushing stablecoin legislation and trying to assuage concerns that its products are used by criminals and terrorists. In meetings in Washington earlier this month, CEO Paolo Ardoino pitched his company’s product as a way to keep America’s ballooning debt out of unfriendly or unstable hands. Tether said it was the 7th largest buyer in 2024 of Treasury bonds, which it holds as collateral backing its signature stablecoin.

“There will be a huge attempt to de-dollarize the world” led by BRIC nations including China, Ardoino told Semafor this week, echoing his message to officials during his recent trip. “And Tether is the only company that is trying to slow down that event.”

China’s plea to Western businesses

A top Chinese official warned Western business leaders in Beijing this weekend against a “return to the law of the jungle,” urging them to ignore trade tensions and keep investing. “We have prepared for possible unexpected shocks, which, of course, mainly come from external sources,” Premier Li Qiang said in his speech opening the China Development Forum. The annual gathering, which has long hosted frank (by Beijing’s standards, anyway) discussions between Chinese officials and Western CEOs, took on heightened importance this year, as China is trying to reverse plummeting foreign investment into its slowing economy. President Trump said Friday that trade chief Jamieson Greer would speak with his Chinese counterpart this week, ahead of the implementation of the long-threatened tariffs slated for April 2.

Treasury’s regulatory power play over Fed

Treasury Secretary Scott Bessent’s play for more control over banking regulators, including the Federal Reserve, is about to enter a contentious new phase as his department starts drafting recommendations to streamline the agencies, Semafor’s Eleanor Mueller and Rachel Witkowski report.

Given that merging the banking regulators would likely require Congress’ approval, Bessent has said he instead wants to give the Treasury more control over their rulemaking process in pursuit of “safe, sound and smart deregulation,” while still allowing the Fed to retain its independence in crafting monetary policy. But establishing greater oversight of how the Fed supervises banks is nevertheless a new front in Trump’s battle to rein it in — and one that would do little to improve overall efficiency, since banks would still report to the same alphabet soup of regulators.

Apple’s AI woes deepen

Apple is replacing the executive in charge of its key AI products as investors worry it’s falling farther behind rivals. The company’s shares are down 10% over the past month after the disappointing rollout of Apple Intelligence, which was late to arrive and failed to impress. Semafor’s Reed Albergotti writes that Apple’s fanatical commitment to privacy, which historically endeared it to customers, is now holding it back: “The company cut itself off from the driving force of the internet economy: consumer data and machine learning to sell personalized ads.”

Chevron caught in Venezuelan crossfire

The Trump administration ordered Chevron to wind down its lucrative Venezuelan operations within two months. The president also threatened sanctions on any countries that buy oil from Venezuela, adding a new term — “indirect” tariffs — to the growing trade lexicon.

Chevron was the only American company operating in Venezuela, under a waiver from the US government that allowed it to sidestep sanctions against the Maduro regime. Venezuela sits on the world’s largest oil deposits, which accounted for 8% of Chevron’s production in 2023.

Chevron CEO Mike Wirth made his case in Washington earlier this month, warning that China’s national oil company could step in if Chevron was forced out, The Wall Street Journal reported. He failed to convince officials including Secretary of State Marco Rubio and National Security Adviser Michael Waltz, who are both China hawks but have also taken a hard stance against Maduro, thanks to a significant Venezuelan expat community in their home state of Florida.

— Rohan Goswami

BigLaw backlash

About 100 alumni of Paul Weiss signed an open letter criticizing the firm’s decision to settle its dispute with Trump by donating legal services to the president’s agenda, calling it a “craven surrender” and invoking McCarthy’s political persecutions. Meanwhile, other law firms are bracing for their turn in the crosshairs, including the previous homes of Bush’s former FBI director and Special Counsel Robert Mueller, who investigated Trump’s connections to Russia, and Todd Blanche, who resigned as a partner at Cadwalader, Wickersham, & Taft to defend Trump in his criminal trial in New York last year involving the falsification of business records. “Obviously, doing this as a partner at Cadwalader was not an option,” Blanche wrote at the time.

Protestations are so far getting little traction in a business world desperate to stay out of trouble, but keep an eye on elite law schools. If Paul Weiss starts losing top recruits to firms that have held the line against the White House — assuming there are any by the fall, when on-campus recruiting starts — that could change the #resistance math.

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➚ BUY: Tesla. Shares are up 25% over the past two weeks as MAGA faithful heed the White House’s calls for support. (In a rare bit of fourth-wall-breaking, star automotive columnist Dan Neil admits he bought a Tesla “and now my neighbors think I’m soft on Nazis.“)

➘ SELL: Ford. Safety regulators have opened an investigation into gearshift flaws in more than 1 million F-150 trucks. The investigation comes after Ford had a series of recalls over reports of issues with its backup camera, battery, and other problems.

Making Business Great Again

Semafor is keeping tabs on the business community’s response to the Trump administration.

• Stated purpose: Delaware representatives are set to vote today on a controversial package of legal and court reforms meant to stem a corporate exodus set off last year by Musk. A vote originally scheduled for last week was delayed, and people familiar with the matter say the nose count in the state legislature, where the plaintiffs’ bar carries significant sway, is tight.
• Louisiana purchase: Hyundai will invest $20 billion in the US, including a new $5 billion facility in Louisiana, in an effort to sidestep auto tariffs that Trump said are coming soon.
• Rules of the road: The FBI created a task force to investigate Tesla vandalism. It follows Commerce Secretary Howard Lutnick’s public endorsement of Tesla shares and Trump’s turning the South Lawn into an impromptu showroom.
• Covid cartwheels: “Being flexible and cognizant of the broader context is really important,” YouTube CEO Neal Mohan told Semafor’s Ben Smith and Max Tani on the Mixed Signals podcast. He was discussing YouTube’s unwinding of pandemic content-moderation policies — “where the world was five years ago is very different than where it is today” — but ideologically flexible and context-aware captures Silicon Valley’s rapid turn to the right.
• Disem-voweled: JPMorgan renamed its DEI office to “DOI” — for diversity, opportunity, and inclusion, telling employees the new name “more accurately reflects” what clients expect from the business.

Markets

• Risk on: A surprise winner in the Trump trade chaos are US junk bonds. Risky debt should be less attractive with the economy on the precipice, but juicy yields are luring BlackRock, among others.

Companies & Deals

• Winging it: Boeing’s contract to build the Pentagon’s drone fighter — the most expensive jet program in history — is a boost to the aerospace giant, which still hasn’t recovered financially or reputationally from a series of blunders. But it’s a high-wire act: Boeing hasn’t designed a front-line warplane since the 1990s.
• Genes for sale: Genetic testing firm 23andMe filed for bankruptcy protection Sunday after CEO Anne Wojcicki’s efforts to take the company private failed. The looming question: What happens to the DNA information of its more than 15 million users?

Watchdogs

• Private eyes: Germany’s financial regulator is quizzing the country’s top insurers about their alternative asset investments, an official told Bloomberg. The 2023 failure of Italian life insurer Eurovita, which was owned by private equity, highlighted the risks of Wall Street’s growing love affair with a sector that’s been loosely regulated on both sides of the Atlantic.

Trump’s seemingly pro-fossil fuel policies may be drawing the ire of climate activists. But for some climate investors, they signal an opportunity to pick up renewables assets on the cheap, Semafor’s Prashant Rao reports.

“The US is going to be a very relevant, meaningful market for us in the next few years,” said Oscar Perez, CEO and managing partner of Madrid-based Qualitas Energy, which last year acquired a North Carolina solar-and-battery-storage business after around 12 years of staying out of the US.